Correlation Between Knightscope and RCABS
Can any of the company-specific risk be diversified away by investing in both Knightscope and RCABS at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Knightscope and RCABS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knightscope and RCABS Inc, you can compare the effects of market volatilities on Knightscope and RCABS and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Knightscope with a short position of RCABS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knightscope and RCABS.
Diversification Opportunities for Knightscope and RCABS
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Knightscope and RCABS is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Knightscope and RCABS Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RCABS Inc and Knightscope is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Knightscope are associated (or correlated) with RCABS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RCABS Inc has no effect on the direction of Knightscope i.e., Knightscope and RCABS go up and down completely randomly.
Pair Corralation between Knightscope and RCABS
Given the investment horizon of 90 days Knightscope is expected to generate 1.42 times more return on investment than RCABS. However, Knightscope is 1.42 times more volatile than RCABS Inc. It trades about 0.05 of its potential returns per unit of risk. RCABS Inc is currently generating about -0.08 per unit of risk. If you would invest 1,803 in Knightscope on August 31, 2024 and sell it today you would lose (67.00) from holding Knightscope or give up 3.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Knightscope vs. RCABS Inc
Performance |
| Timeline |
| Knightscope |
| RCABS Inc |
Knightscope and RCABS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knightscope and RCABS
The main advantage of trading using opposite Knightscope and RCABS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knightscope position performs unexpectedly, RCABS can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in RCABS will offset losses from the drop in RCABS's long position.| Knightscope vs. LogicMark | Knightscope vs. Guardforce AI Co | Knightscope vs. Bridger Aerospace Group | Knightscope vs. Iveda Solutions |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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